Everybody’s talking ’bout a Nu-World in the morning
Promising earnings for consumer goods company with its fingers in everything from booze to TVs and fridges
Nu-World Holdings, which manufactures and distributes a wide range of consumer goods, looks on track for solid profit growth in the year to end-August.
The group – which specialises in consumer electronics, hi-tech equipment, small electrical appliances, white goods, liquor and furniture – reported a 16% jump in net profit to R85-million with earnings coming in at 399c per share for the half-year to end February.
Des Mayer, senior analyst at Afrifocus Securities, said the interim showing was “pretty decent” – adding that Nu-World was on track to post 800c per share in earnings for the full financial year.
Mayer said the group’s core South African operations pushed up revenue 16% with profits coming in 28% higher. “This shows a nice widening of the margin.”In commentary accompanying the results, Nu-World CEO Jeffrey Goldberg said the consumer electronics division added more models, categories and brands in the interim period – which contributed to increased sales.
Goldberg said liquor sales continued to grow as additional brands and categories were added to the product offering. He said additional single malt whiskies as well as a range of flavoured vodkas had been introduced.
In the small domestic appliances and white goods segment, Goldberg said Nu-World also introduced more product designs and concepts.
Nu-World laboured somewhat with its offshore endeavours with revenue dropping 10% to R395-million. But profits were held at R30-million, which Mayer said indicated an encouraging effort at margin protection.Goldberg said the Australian operations came under pressure due to the subdued Australasian economy, while business in the Africa/Middle East/Commonwealth of Independent States/South America hub managed to show growth with local currencies strengthening against the dollar.
Goldberg said Uruguay continued to be a strong presence in Latin America. He said the distribution network was increased and additional stocks had been ordered for markets in India, Pakistan and Sri Lanka.